Moinian sues HPD over Sky’s 421a status

Debate brews over construction start date of 2008 or 2014

New York /
Nov.November 10, 2016 02:00 PM

The Moinian Group, the developer behind the 61-story rental tower Sky, is suing the New York City Department of Housing Preservation and Development to reverse the agency’s decision regarding the project’s 421a benefits.

What’s under debate is when construction on the Midtown project at 605 West 42nd Street officially launched. Moinian claims it began in 2014, but HPD recognizes the construction start date as June 2008, which significantly decreases the tax incentives Moinian would receive under the 421a program, according to a petition filed Wednesday in New York State Supreme Court.

Under 421a, developers receive tax exemptions for eligible buildings for a construction period of up to three years, followed by decreasing tax abatements over a period of 10 to 25 years depending on various factors. If Sky began construction in 2014, Moinian would still be within the three-year construction phase and the project would be tax-exempt.

The current proposal for Sky is based on plans approved by the Department of Buildings in October 2014, which differ significantly different from a previous design approved in 2008. The new building is 15 stories taller, spans 1.2 million square feet instead of 880,976, and includes 1,175 units instead of 764. The new building is also expected to include 235 affordable units and a public health club featuring multiple swimming pools, neither of which were included in earlier plans.

According to Moinian TRData LogoTINY, that should make him eligible to 421a benefits beginning in 2014, putting him early in the benefit cycle.

Construction on the earlier version began in 2008 but was stalled in 2009. A previous 421a application for the site, submitted by Moinian in 2012, cited the 2008 start date.

Moinian is seeking a court order annulling the HPD’s determination and accepting an official construction start date of October 2014.

Neither Moinian nor the HPD responded to requests for comment.


Related Articles

arrow_forward_ios
HUBB NYC’s Jesse Terry with 150 Union Avenue
HUBB NYC picks up Williamsburg rental for $78M
HUBB NYC picks up Williamsburg rental for $78M
SpringHealth CEO April Koh, 60 Madison Avenue and Moinian Group’s Joseph Moinian (SpringHealth, VTS, Moinian)
Youngest female unicorn CEO moves startup to Moinian’s 60 Madison Avenue
Youngest female unicorn CEO moves startup to Moinian’s 60 Madison Avenue
1020-1026 Third Avenue (Google Maps)
Kahen Properties buys three Lenox Hill sites for $34M
Kahen Properties buys three Lenox Hill sites for $34M
Domain Companies CEO Matt Schwartz and 404 and 420 Carroll Street (Google Maps)
Domain lands $176M for 360-unit Gowanus project
Domain lands $176M for 360-unit Gowanus project
L+M’s Ron Moelis and 180 Broome Street (L+M, City Realty, iStock)
L+M accused of overcharging tenants at 421a building
L+M accused of overcharging tenants at 421a building
Tankhouse's Sam Alison-Mayne and Pilot Real Estate Group's Rob Rieger (Facades+, Steer For Student Athletes, iStock)
Tankhouse grabs 421a-ready Gowanus development site
Tankhouse grabs 421a-ready Gowanus development site
L-R Governor Kathy Hochul, Scott Rechler, Jack Cayre, and Alex Adjmi (Getty, OSO NYC)
These real estate execs gave Kathy Hochul the most cash
These real estate execs gave Kathy Hochul the most cash
Gov. Kathy Hochul (Photo by Sasha Maslov)
At REBNY gala, Hochul pledges to “support” real estate
At REBNY gala, Hochul pledges to “support” real estate
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...